Siemens ended the fiscal year, which was marked by the Ukraine war and high write-downs on the former energy business, with a profit in the billions. After a strong fourth quarter, the bottom line is a plus of 4.4 billion euros, as the company announced on Thursday in Munich. In the new fiscal year, which has been running since October, Siemens wants to earn significantly more again.

Business was actually going well: the central industrial business at Siemens had even reached a record level. The fact that consolidated profit fell by 34 percent on balance was mainly due to a billion-dollar write-down on the remaining shares in the former energy business Siemens Energy, which had been taken public in the summer. It even gave the group its first quarter of losses in more than a decade. But the withdrawal from Russia also had a negative impact on business.

Nevertheless, sales increased nominally by almost 16 percent to 72 billion euros. The shareholders will not feel anything from the drop in profits either: the dividend is to rise by 25 cents to EUR 4.25 per share.

Sustained high demand

Siemens CEO Roland Busch spoke of an “extremely challenging year” and an “outstanding performance”. Siemens has gained market share and the high demand for the group’s hardware and software offerings is continuing, he stressed. In the fourth quarter of the year, everything was right again at Siemens with a whopping profit of 2.9 billion euros. However, a significant profit from the sale of the post and parcel business also contributed to this.

The next possible sales are already being prepared. Siemens has been working on spinning off its Large Drives (LDA) business for some time. Here it is now going to be an even bigger hit: Siemens now also wants to bring in low-voltage and geared motors from the Motion Control area, the manufacturing technology subsidiary Sykatec and the special business Weiss Spindeltechnologie.

Overall, a new unit with a turnover of around three billion euros and 14,000 employees is to be created in the course of the financial year. That’s about twice the size of the LDA area, as Busch confirmed. “The new company will be extremely competitive,” he said. In view of the expansion, however, CFO Ralph P. Thomas probably no longer expects the conclusion in the current financial year. But that’s not necessary, he stressed. You are not pressed for time.

Hagen Reimer, who is responsible for Siemens at IG Metall, notes: “We are still extremely skeptical about the spin-off itself.” But if it cannot be prevented, “then we consider it to be the most favorable perspective in its current expanded form. This means that the future company is the most stable and broadest.”

For the current year, Siemens expects a significant increase in profit. Adjusted for certain purchase price effects, it should rise to EUR 8.70 to EUR 9.20 per share. That would be an increase of 59 to 68 percent. Roughly speaking, that would be around 7.2 billion euros for the group.

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